Pakistan Credit Rating Agency Limited assigns entity ratings to National Power Construction Corporation
Lahore, May 20, 2016 (PPI-OT):National Power Construction Corporation (Pvt.) Limited was privatised in August-15. All legal formalities are completed and the company is now majority (88%) owned by Mansour-Al-Mosaid (MAM), a Saudi business group. MAM has taken full control – new board has been appointed, organogram is restructured, and business strategy is in place.
Hence, PACRA removes rating watch. The Pakistan Credit Rating Agency Limited (PACRA) has assigned the long-term and short-term entity ratings of “A-” (A minus) and “A2” (A two) to National Power Construction Corporation (Private) Limited (NPCC). These ratings denote a low expectation of credit risk emanating from adequate capacity for timely payment of financial commitments.
National Power Construction Corporation, a specialized company having expertise mainly in power engineering projects, is a recognized pre – qualified bidder in Kingdom of Saudi Arabia (KSA) / Pakistan and other power utilities in Middle East / Far East. MAM – the new sponsor group, intends to capitalize on NPCC’s strengths mainly related to undertaking high-voltage transmission lines projects in KSA.
Meanwhile, the acquirer envisions to establish its footprints in growing power sector of Pakistan through utilizing resourcefulness of Pakistani management. Although it seems workable; various challenges may have to be faced including, building a strong Pakistani team, and arranging financial resources from Pakistan’s market. The ratings draw comfort from new sponsor’s commitment demonstrated by providing tangible comfort to banks to support NPCC’s continued financial needs.
The ratings are dependent on company’s ability to sustain its healthy business profile in KSA, while success in establishing business in Pakistan is a factor. Meanwhile, management of financial profile would remain important. Establishing good governance framework while effective execution of business strategy to improve the company’s performance may positively impact the ratings.
For more information, contact:
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425